Rent vs Owning a Home

RENTING BUYING VS WHICH IS RIGHT FOR YOU? FOR ???? 8:::::::::::::: It used to be commonly accepted that buying a home was an investment for the future. Since then, the bull run in the housing market has ended and experts don't think it'll be back anytime soon. IS BUYING A HOUSE REALLY A BETTER CHOICE THAN RENTING? According to the U.S. census, the average cost of a house (including the cost of land) was: $272,900 $319,275 in 2010 in 2013 RENTING DOWN PAYMENT BUYING Usually, renting requires a deposit equivalent to the first and last month's rent As a general rule, the down payment on a home is 20% of the purchase value For a home worth $250,000, this is a down payment of $50,000 While this may be returned to you at the end of your lease, any damages caused while renting can cause you to forfeit part or all of your deposit. To most people, this is a huge chunk of money to pay out at one time. Because of this, it can take a while for buying a home to save money over renting. FIXED RATE When renting, landlords can change rental or utility rates at the end of a leasing period. A fixed-rate mortgage lets homeowners know exactly what their monthly payments will be for as long as it takes to pay off the house. CUSTOMIZATION The average homeowner spends about $2,300 on home improvements every year. The average major kitchen remodel cost $109,935 in 2014 While some landlords may let renters paint, it is rare to be able to do any big renovation projects. When selling the home, those who did a major kitchen remodel got about 62.6% of the investment back from the home's increased value. (Based on above average $69,973 return.) TAXES The property taxes on a home can take a toll Lowest average tax rate in the U.S. is 0.18% Highest average tax rate in the U.S. is 1.89% LOUISIANA NEW JERSEY A renter does not have to pay property taxes separately. Average property tax is $243 per year for a home with an average value of $135,400. Average property tax is $6,579 per year for a home with an average value of $348,300. MAINTENANCE Renters typically aren't responsible for fixing things when they break. When you own your home, you have to plan for the possibility of the water heater breaking down or the roof leaking, and paying for that when it happens. However, a renter must notify the landlord when something goes wrong. Each year, a homeowner should budget 1-2% of the purchase price of their home for maintenance. Waiting for maintenance to be done can be an issue. For a $250,000 home, this would add up to $2,500 to $5,000 every year or $209 - $417 a month. Check local laws to see how long a landlord has to fix your problem. STABILITY When renting, there is less security. ? A landlord can decide to stop renting to a tenant at the end of a lease and if a landlord sells the property, tenants may have to move on short notice. Buying a home allows a family to find a place where they know that they can stay. A tenant can be kicked out for violating the lease. INSURANCE The average cost of renter's insurance is $12 a month ($144 annually) to cover property worth $30,000, plus $100,000 in liability coverage. To estimate your annual insurance premium, divide the value of your home by 1,000 and multiply by $3.50. Renters pay an average of $12/month to cover property worth $100,000. Renters do not have to cover any structural damage. For a $250,000 home, the cost of insurance would be about $73 a month, or $875 a year. FLEXIBILITY Renters have the option of leaving a place at the end of a lease and don't have money A home is an investment that is hard to part with. Selling a home can take months or years and runs the risk of selling at a loss. RENT tied up in their homes. If you're looking to buy a house to save money on monthly payments, think again. Because of the high initial costs of buying a house, such as a down payment, it can take several years to actually see the money-saving benefits of buying over renting. If you're planning on owning your home for 10 years or more, buying is a great option. If your plans are more short-term, you may want to rent instead. Presented by: RENTING OR BUYING Which one is right for you? SpareFoot SpareFoot.com Sources: forbes.com/sites/billconerly/2013/11/11/should-you-buy-a-house-or-rent-the-economics-of-homeownership/ homeguides.sfgate.com/average-cost-homeowners-insurance-3020.html business.time.com/2012/12/03/is-it-better-to-rent-or-to-buy/ census.gov/construction/nrs/pdf/uspricemon.pdf mint.com/blog/goals/home-repair-02022011/ tax-rates.org/taxtables/property-tax-by-state homeinsight.com/details.asp?url_id=7 emodeling.hw.net/cost-vs-value/2014/ census.gov/const/uspriceann.pdf DEVELOPED BY N NOWSOURCING